If it is a red letter, there is a high risk the policy will not pay out, and that starts a very important clock ticking

Louise Hanson, Consumers Association

He continued: "One could argue that the Financial Services Authority and the life industry really want to get this over and done with this year... By September, October time there will be no more people able to complain about endowment mis-sales."

Commenting on the letters, Louise Hanson, Head of Campaigns at the Consumers Association said:

"By calling them a yearly statement, it does not bring a sense of urgency, or really accurately reflect, that if it is a red letter, there is a high risk the policy will not pay out and that starts a very important clock ticking."

Appropriate action

But Alan Leaman, Head of Public Affairs at the Association of British Insurers (ABI) denied that his members are trying to mislead their customers.

I think what we would be pleased about is if people took appropriate action if they were facing a shortfall

Alan Leaman, ABI

"The wordings of [the letters] were poured over in great detail with the FSA and they are accompanied by an FSA leaflet entitled 'Your endowment, have you acted yet?', with a very clear description of - if you want to complain - how to go about it."

Mr Leaman told the programme the letters are meant to get a response:

"I think what we would be pleased about is if people took appropriate action if they were facing a shortfall."

But Louise Hanson says letters should be properly colour-coded and include information on what mis-selling is and how to complain in the body of the letter itself.

Meanwhile policy-holders receiving letters are advised to look out for the phrase "there is a "high risk" the policy will not pay out".

Concerned policy-holders can also call their insurers to find out more.

BBC Radio 4's Money Box Live was broadcast on Saturday, 28 February, 2004 at 1502 GMT.